Side Hustle: How 40 thousand income equals 1 million retirement savings

Side Hustle: How 40 thousand income equals 1 million retirement savings

How is that possible?  Let me show you.

If you’re a FIRE or simply looking to retire early, you will need to live off your income.  So let’s say you need $40k annual income to retire.  The common rule of thumb is you can live off 4% of your savings without touching the base principal, so you would need 1 million in savings.

So here’s the math:

• $1 million in savings
• 4% annual income needed
• $40k annual income provided

The idea is your $1m is making 4%+ in appreciation so you spend the profit without tapping into the $1 million.

Ok, so $1 million in savings returning 4% income equals $40k annual income without touching the principal.  Got it.

So now let’s do that math backwards.  Let’s say you have a side hustle income of $40k annual.  If you earn $40k annual or $4k monthly, then how much savings does that equal?

• $40k annual side hustle income 
• $40k is 4% of $1 million dollars

So there you go.  If you can generate $40k of side hustle income, it will be similar to $1m in retirement savings.

But Side Hustle Income Requires Effort, Right?

Ok, so having $1m in savings invested into an ETF requires little to no effort where a side hustle does require effort. 

Yes, that’s true.

However how much time and effort does it take to save $1m?  For an average US income its 10 to 15 years.

How much time does it take to generate $4k per month in a side hustle?  It could be months.

Power of Side Hustle Income

So now we understand the power of the side hustle income for FIRE or those who seek early retirement.  It could pull forward retirement by 10 to 20 years!  Now THAT is powerful.

How to Generate Side Hustle Passive Income?

So the next thought you have is how do I generate side hustle or passive income?  What skills do I have?  Where do I get started?

Here’s the good news, and the bad.

The GOOD news is there are thousands of ways to generate side hustle and passive income while you’re working your day job.  With the power of the Internet, Social Media, and Digital Media platforms you only need to capture a tiny slice of a big pie.  Simple re-use something proven, you don’t need to reinvent the wheel.

The BAD is it will require ACTION.  Yes, it will mean time, research, and even a little pain here and there.  But doesn’t the reward outweigh the risk?

What are Examples of Side Hustles?

Here is a short list of examples:

• Blog site Google Ad Sense
• Blog site affiliate revenue
• Stocks & Bond dividend income
• Social Media Platforms
• Real Estate income

In Conclusion

So I have proven the power of side hustle and passive income!  Think about ways you can generate $4k per month in side hustle income that could pull forward your retirement by 10 to 20 years!